Intuit identified Finicity as a solution that will provide a “façade” API interface that translates Intuit-structured API calls into Finicity-structured API calls.

Financial Data API Backstory

The Financial Data APIs from Intuit allow developers to link to end-users’ banking accounts from within their application.

In September of 2012, Intuit announced that it was opening up the technology that powered Intuit products like Mint.com, Quicken, and QuickBooks to the developer community via a library of APIs that it called Customer Account Data (CAD).

Customer Account Data, which was rebranded Financial Data APIs, is composed of two separate products: the Transactions API and the Identification API Beta.

The Transactions API offered connections to roughly 20,000 US and Canadian financial institutions, enabling third-party developers to quickly and cost-effectively deploy aggregation functionality to a wide array of financial sources.

The Identification API Beta facilitated customer’s identity and banking account verification using banking credentials. Developers were able to configure ACH connections via the API instead of relying on microdeposits (a series of deposits under $1 that the customer verifies) and a process called “fatfingering.”

FinTech Floodgates

The general availability of the Intuit Financial Data APIs opened the floodgates of all sorts of new B2C fintech startups that featured the aggregation of users’ financial accounts. These startups included popular names such as LearnVest, SaveUp, Hello Digit, BillGuard, and more.

A similar increase has taken place among B2B account aggregation providers, with companies like Blueleaf, Wealth Access, Quovo, Plaid, and Right Capital all appearing with some type of advisor aggregation fintech solution over the last four years.

Prior to the new wave of account aggregation providers, advisor solutions were dominated by four key players:

Betterment (retail and Institutional, based on their use of both Plaid and Quovo)

Note: Prior to August 30, 2016, I had Right Capital in the list above. After connecting the Right Capital co-founder Shuang Chen, I learned the company had considered Intuit’s API for aggregation at one time, but ultimately decided to engage Yodlee for account aggregation. Therefore, Right Capital will not be affected by the Intuit API shutdown.

In its press release, Intuit identified Finicity as an alternate provider of aggregation services.

We have identified a new aggregation partner, Finicity, for whom this service is a core part of their business. Finicity can offer long-term benefits and service for our aggregation customers. To minimize developers’ engineering work to switch APIs, Finicity will provide a façade API interface that translates Intuit-structured API calls into Finicity-structured API calls.

The “façade API interface” means that developers with existing code that calls on Intuit APIs will not need to change their codebase. Instead, Finicity will publish an API interface that is 100% compatible with existing calls to the legacy Intuit APIs and return data to the developer’s application as if Intuit’s APIs never went away.

Who is Finicity?

For me, Finicity is a newer name in aggregation that came to my attention last year while monitoring Quora for details on Yodlee despite founding the business in September 2000.

While the Finicity compatibility endorsed by Intuit sounds good for existing developers, there are certainly other issues to consider before building a business on top of Finicity services, and that absolutely should factor into the due diligence process of advisors.

2015 has been a good year for Finicity. We’ve signed hundreds of Fintech and Financial Institutions to build their solutions on our API, have quietly launched over a dozen partners, and are launching dozens more in 2016. Our partners tell us that our broad native data source coverage and our fanatical agg support teams are the primary reasons why they love us.

-Nicholas Thomas

So with relatively little marketing (e.g. as I published this, their most recent tweet was on October 27, 2015), Finicity managed to sign up “hundreds” of customers, launched “over a dozen” partners, with more on tap in 2016.

Is account aggregation Finicity’s only play in the industry? No.

To see what other lines of business Finicity offers in addition to their aggregation services, their website lists two other divisions: Mvelopes and Money 4 Life Coaching

Mvelopes from Finicity

Mvelopes is a software application for personal budgeting and has extremely high ratings for its apps in the app stores. Surprisingly high, actually (more on this later).

Mvelopes allows users to create virtual envelopes for different spending categories and allocate money to them accordingly. The idea is that throughout the month, users refer to the amount of money left over in each envelope after paying bills in order to preventing overspending. Transactions are aggregated from connected accounts, and transactions are automatically deducted from applicable virtual envelopes of available cash.

The service is free to use with a limit of four aggregated cash flow and credit accounts (here’s the Finicity aggregation connection). To access unlimited accounts, users subscribe to the Mvelopes Premier plan for $95/year.

Money 4 Life™ Coaching

Where things get more controversial for me is Finicity’s division called Money 4 Life™ Coaching. The Mvelopes pricing page makes the first mention of coaching services and describes how customers can benefit from one-on-one coaching customized for individual needs.

So I looked into this coaching services with a quick Google search and came across quite a few consumer complaints (36 to be exact) about the services on the Better Business Bureau website.

Most of the complaints seem to be centered around the Money4Life coaching including allegations of no contact by coaches for months at a time and allegations of cancellation difficulties.

Most complaints listed on the BBB site appear to reach a satisfactory conclusion once customers initiate the dispute process (which results in an overall BBB rating for Finicity of A+) , but it is surprising that many customers feel that they need to involve BBB in the first place in order to reach a resolution.

Also, the Mvelopes mobile app ratings are overwhelmingly positive, but many of the five-star reviews have no details in the description or come from users with no other app reviews other than Mvelopes. It’s eyebrow raising.

Critical Mvelopes app reviews such as the one below from iTunes are enlightening:

I contacted Finicity for comments and have not yet heard back from the company, so I will update this post accordingly.

What’s Next?

So what’s next? Given Finicity’s connection to awkward customer experiences under the Money4Life coaching program, how likely are the younger aggregation providers to migrate their API calls to the Finicity API? Or will there be a trend to simply abandon the aggregation of financial institutions currently covered by Intuit?

No matter what, as the aggregation vendors make their decisions behind the scenes, advisors’ clients will need to reauthenticate their usernames and passwords once a migration to a new aggregation service is implemented.

For some firms that have a handful of aggregation accounts, this may be a non event, but for larger firms with thousands of aggregated accounts, the issue could take weeks or months to resolve as all clients work through their accounts to reauthenticate their login credentials.

Fiserv’s CashEdge also performs account aggregation and the company sells an advisor-facing aggregation product called AllData Advisor®.

MoneyGuidePro has offered discounted pricing for Yodlee, but now is presented with a conflict given that Yodlee’s new owner also recently acquired Finance Logix, a competing financial planning software solution.

Good or Bad?

So is this good or bad for financial advisers?

If you’re Envestnet, or if you use Envestnet products and services in your business, this acquisition is good. Very good. Envestnet now has a very broad portfolio of services that helps financial advisers run efficient businesses.

What services, you ask? They offer CRM, portfolio management and reporting, client portals, business intelligence, and mobile apps from Envestnet|Tamarac, financial planning software from Finance Logix, and now account aggregation from Yodlee.

If you’re a vendor who competes with Envestnet AND offers account aggregation to your financial adviser users, it could be bad. One of your product’s competitive differentiators, account aggregation, just got acquired by a leading vendor of financial technology and portfolio management solutions to advisers. Now what do you do?

And if you’re an adviser who doesn’t use Envestnet, your choices for an independent account aggregation solution are now smaller. Who’s left? Aqumulate, Intuit, Quovo, and Openfinance.

ByAllAccounts is owned by Morningstar (but an important note is that Morningstar doesn’t sell investment products or portfolio services, but rather adviser technology and investment research).

And Intuit is a special case, too, as once again, advisers can’t directly purchase or subscribe to Intuit aggregation. Aggregation from Intuit must be integrated by a third-party technology provider.

Openfinance is one to watch, as I was told recently that First Rate, SunGard’s main performance reporting partner, teamed up with OpenFinance to provide aggregation solutions for First Rate integration partners (e.g. Grendel CRM from Big Brain Works).

Plaid is out there too, but as far as I can tell, their bread-and-butter customers are consumer-oriented financial apps like Acorns and robinhood.

So overall, are the limited choices among aggregation solutions good or bad? I’m not entirely sure.

Some advisers choose not to offer account aggregation at all. Some do. It largely depends on how the business is structured and whether or not account aggregation boosts the overall value proposition of the firm.

A Yodlee Backstory

One of the Achilles’ heel of financial services is the forced fragmentation of where all of us keep our money.

Your monthly income and spending flows through a bank checking account.

Want a savings account that actually has an annual interest rate that isn’t zero? You’ll probably open an online savings account.

Want to invest in low-cost mutual funds? You’ll likely open an account directly with the fund company.

Want to own a few stocks? You’ll need a brokerage account for that.

Want to save for retirement? Your employer requires you to use certain retirement plan providers. Time to open another account.

Want to save for college? Again, your state might have a specific plan sponsor if you want to take advantage of state tax deductions. Boom, another account!

Seriously, why must the industry be so fragmented that consumers have no choice but to open so many discrete accounts across so many financial institutions?!?

So if you’re like most people who live on planet Earth and use money, it’s nearly impossible to see what you have one place AND keep that report up to date as your spending fluctuates and your investments rise and fall.

Enter Yodlee.

Yodlee seized the opportunity among this fragmentation to facilitate all-in-one reporting. As online financial account access became mainstream, Yodlee allows consumers to grant permission to read data from each financial account and aggregate all that disparate data into one dashboard, the Yodlee MoneyCenter. To build a buisness, Yodlee charges third-party companies (e.g. banks, insurance companies, trust companies, broker-dealers, financial apps like Personal Capital and LearnVest) to be on the receiving end of the aggregated data.

Fast forward to today and Yodlee’s market value for its business is in the neighborhood of $660 million.

And now you know the Yodlee backstory (well, as I tell it. There’s a lot more to the story, but this is what matters for you, the financial adviser).

Note: An earlier version of this post suggested that rumors indicated the Fiserv adviser-facing product AllData Advisor® was being phased out. A company spokeswoman for Fiserv wrote, “At this time, Fiserv has no plans to phase out the referenced advisor-facing product.”

Bob Curtis, President and CEO of MoneyGuidePro (right) forecasting the future of financial planning with Harold Evensky (left)

Popular MoneyGuidePro financial planning software to aggregate held away accounts through a new Yodlee integration

Ask most technology consultants and financial advisers about their account aggregation options, and you’ll likely hear just a few common names.

ByAllAccounts, Fiserv’s CashEdge, and perhaps Intuit.

But Yodlee?

That solution almost never gets mentioned.

Until now.

MoneyGuidePro Integrates Yodlee

In a packed general session at the 2014 Technology Tools for Today (T3) conference, Bob Curtis, President and CEO of MoneyGuidePro announced that the popular financial planning software program will soon integrate account aggregation functionality using services from Yodlee.

One of the reasons I believe Yodlee hasn’t gained traction among financial services technology solutions is price. Yodlee is a rather expensive solution relative to its counterparts in the marketplace.

But MoneyGuidePro is breaking down the potential barrier of cost with very aggressive pricing.

Yodlee For $1 a Day

In his general session, Curtis announced that MoneyGuidePro will offer the Yodlee integration at an introductory cost of $365 annually. That’s right, just $1 per day.

And as to when the Yodlee integration will be available, Curtis told advisers that the account aggregation functionality is anticipated to be rolled out in Q2 of 2014.

[I told you about Orion Connect back in April. Here’s the official announcement from the company, which is a strategy I believe will continue to accelerate the prevalence of salesforce.com in most adviser offices.] Orion Advisor Services, LLC, a premier portfolio accounting service provider, today announced that its new Orion Connect application is available on salesforce.com’s AppExchange, the app marketplace for the social enterprise.

[When I interviewed Advisor Websites Co-founder and CEO Bart Wisniowski, I had no idea the company was about to turn ten years old. In recognition of this milestone, the company is offering discounted pricing if you sign up for a new website by the end of June. Strike while the iron is hot, right? (I do not get paid for any of this; I just like the quality of work they deliver for advisers)] Advisor Websites, a leading web-based software used by financial professionals to create and manage compliant websites, turned 10 this week and is pleased to mark this special event with the launch of its newly redesigned website.

[Clearly you have a lot to gain by embracing account aggregation in your business. You see nearly all of your clients’ investable assets, not just those held at your custodian, and you can increase revenue if you include held-away assets in your billing and service models. Most of you already know that aggregation isn’t widely used, with 3 of 4 surveyed advisers acknowledging they don’t, but I just wish data from Fiserv’s CashEdge Divison was reconciliation-ready out of the box.] Fiserv, Inc., a leading global provider of financial services technology solutions, today announced the results of its annual financial advisor survey. The survey revealed that financial advisors currently lack access to the aggregated account data needed to provide them with a complete view of their clients’ finances, which could impact advisors’ ability to provide holistic guidance.

[Need a quick roundup of six providers of social media archiving? Here’s a succinct list. However, Smarsh deserves a mention as they’re #1 among broker-dealers according to a recent survey by Beacon Strategies] Social media is an incredibly fun and effective way to engage with millions of people online. Along with the excitement, however, is the perceived buzz kill—FINRA and SEC compliance standards.

[Account aggregation isn’t the niche service it once was a few years ago. With web services like Mint.com and Blueleaf able to consolidate accounts into one simple dashboard, advisers recognize the need to deliver the same capabilities to their clients.] Driven by client demand, technology advances and increasing advisor interest, 2011 has been a banner year for account aggregation, but wealth managers are divided on how to price the service.

[If you want to operate a paperless office, the last thing you need is a custodian who requires a wet signature from clients on a physical piece of paper. TD Ameritrade’s integration of electronic signature capabilities from DocuSign closes the loop in what was once a frustrating aspect of trying to be completely paperless.] This week, TD Ameritrade will roll out an upgrade of its open architecture platform’s integration with cloud-based electronic signature system DocuSign, as it streamlines DocuSign’s pairing with financial form-filling software Laser App.

[Which is it? Advisers have finally wised up and stopped using Outlook as their CRM, or has Redtail been the beneficiary of advisers looking to transition many of their essential tools to the cloud? I say it’s the latter.] Microsoft Outlook moved down to second place — overtaken by Redtail — in the CRM software category this year. It was the first time in the history of Financial Planning’s annual tech survey that Outlook was not in first place.

[Custodians are in an arms race to be the best integrator out there. Read Joel Bruckenstein’s take on Schwab’s latest efforts.] About a year ago, leading up to the Schwab IMPACT Conference, Schwab Advisor Services laid out its technology road map for the future. Since that time, however, the company has been rather quiet about its integration initiatives.

I took advantage of the typical summer slowdown and spent most of the week on vacation. I’m back at FPPad headquarters for the next week and then off to Portland, OR to speak to the FPA of Oregon & SW Washington chapter on July 20. Drop on by if you can!

[CashEdge is one of those names that pops up every so often when discussing account aggregation. However, it’s an incomplete solution for advisers seeking reconciliation-ready data for held-away accounts. So I don’t see Fiserv’s acquisition of CashEdge for $465 million dramatically altering the account aggregation space] $465 million deal is mostly a payment processing technology-grab, according to ByAllAccounts.

[Envestnet is competing in the portfolio management software market with its Vantage product. Will it be powerful enough to compete with market dominators Advent and Schwab?] Envestnet has long been the undisputed leading platform for separate account managers, used by tens of thousands of advisors. The portfolio management software capability it provided, on the other hand, was always viewed as an add-on service.

[Actifi’s Spenser Segal identifies the Achilles heel of poor CRM software implementation: people] Even though CRM systems have matured, with many systems built specifically for financial advisors, most firms are only scratching the surface when it comes to taking advantage of key features that are designed to help advisors grow their practices.

Our review of Laserfiche Empower 2011 is still in its draft stages while we’ve been preparing content for the upcoming T3 Conference in February. It’s been another busy week behind the scenes at FPPad, but we’ve selected a few top stories of interest from the past week:

We call this the “financial planning profession,” right? So here’s a topic for discussion: how is it that many people calling themselves a financial planner don’t actually do financial planning work for their clients?